One of the biggest changes to be announced at the recent launch of the facelifted Audi A4 was the transition of its S4 performance model to a diesel powertrain.

Audi is switching all its S models to diesel, despite the declining interest in the fuel.

While it may seem like a backwards step, the strategy is actually quite clever and is part of Audi’s message that diesel is not dead.

For fleets, the £47,000 S4 may tempt drivers away from taking the cash option and remaining in the company car scheme. CO2 emissions of 160g/km mean it falls into the highest benefit-in-kind tax band, with 40% taxpayers facing bills of £580 per month – that’s about the same as it costs to lease one.

But drivers are still at an advantage once they consider insurance and running costs. The 3.0-litre V6 diesel engine is fitted with 48v mild-hybrid technology, helping to keep fuel consumption and emissions to a minimum by enabling prolonged engine-off coasting.

Our test saw an average of 42mpg, impressive considering the pace achieved from the 350PS powertrain.

The sedate-looking S4 only gives a few clues to passers-by that it is something special. Inside, sports seats upgrade the regular A4's interior - othewise it's business-as-usual.

The car is restrained on the motorway, making effortless progress. Acceleration is almost instantaneous, with a huge 700Nm torque surge. Even the engine note has been tuned to give a more petrol-like growl. All-wheel drive ensures the S4 always feels planted and pin-sharp steering and brakes mean it delivers great driver thrills.

Drivers can switch between Efficiency, Comfort and Dynamic driving modes, each changing the character of the S4 distinctly.

For businesses where employee retention is an important element of its company car scheme, the S4 will satisfy drivers without exorbitant fuel costs.